Emmis mulls splitting TV, radio biz


Emmis Communications reduced its revenue projection for its TV station group for fiscal 2002 by 3% to $216 million and told analysts Tuesday that it was actively exploring all options for separating its TV and radio businesses.

Emmis Chairman Jeff Smulyan said the "preferred course" would be a tax-free spin off of the TV group. Investors have been pressuring the company to separate the two businesses for close to two years and Emmis considered creating a TV tracking stock last year before the economy tanked. Pro forma TV revenue was down 10% and cash flow was down 20% for the company's first quarter, which ended May 31.

The company's board of directors was scheduled to meet Tuesday to discuss options for separating the radio and TV businesses, but the company is not close to a final decision on how to proceed, said Emmis chief financial officer Walter Berger.

Emmis said told analysts it was not changing its full year projection for radio. Revenues are projected to total $277 million and radio cash flow is expected to total $133 million. In the first quarter, Emmis said its radio revenues were down 9%, but that the company outpaced the markets where they have radio stations, which were down 12.5%.

"We're pleased with our performance in a difficult environment," Smulyan said. Emmis was down 16 cents to $29.18 in yesterday's trading.
- Steve McClellan